August Housing, Single-Family Starts Show Solid Gains

The U.S. Census Bureau and the Department of Housing and Urban Development reported Wednesday morning that new housing starts in August rose to a seasonally adjusted annual rate of 1.36 million, an increase of 12.3% from the upwardly revised July rate of 1.215 million and an increase of 6.6% compared with the August 2018 rate of 1.279 million.

The revision to the July rate added 24,000 new housing starts to the previously reported total. The consensus estimate from a survey of economists expected a January rate of around 1.25 million.

On a non-seasonally adjusted basis, housing starts fell by 1.8% year over year through August. Single-family starts were down 2.7%, and buildings with two to four units fell by 1%.

Single-family housing starts rose by 4.4% month over month in August to 919,000 units on a seasonally adjusted basis. New construction dipped by 1.7% in the Northeast and rose by 8.7% in the Midwest, 3.6% in the South and rose by 5.3% in the West.

The seasonally adjusted rate of new building permits rose to 1.419 million, up 7.7% from the revised July rate of 1.317 million and 12% higher than the August 2018 rate.

Permits for new single-family homes rose by 4.5% month over month in August from a revised annual rate of 829,000 in July to a seasonally adjusted annual rate of 866,000. The rate also increased by 4.5% year over year.

Multifamily starts, for buildings with five or more units, increased by 14.9% year over year in August to 509,000 units. This number is more volatile than the single-family number and has been moving mostly sideways on an annual basis since 2013.

In 2018, 1.242 million housing units were started, up 3.2% compared with 2017. An estimated 1.311 million permits were issued in 2017, up about 3.7% year over year. These totals are subject to future revisions.

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